What Is An Annuity? Tax deferred annuities are contracts that are issued by insurance companies that offer a guaranteed rate of interest and guaranteed payout options. Interest earnings inside of annuities grow on a tax deferred basis unlike other investments. Taxes are paid only when the money inside of the annuity is withdrawn. There are several advantages of tax deferred annuities. Annuities offer very competitive returns that exceed CD's, money market and savings accounts. Unlike other investments, these competitive returns are sheltered by taxes for as long as the earnings remain inside of the annuity. Please use the "instant annuity quote" link on our site for current rates and terms. CD Type Annuities Credited interest rates in these products are guaranteed for the entire term. Terms vary anywhere between 5 and 10 years for most products. These annuities have gained in popularity this year as people are seeking guaranteed rates for periods exceeding one year. Equity Indexed Annuities Credited interest rates in the contracts are based on an index such as the S&P500, Dow, Nasdaq and 10 year treasury bonds. These annuities have gained popularity quickly as many investors are attracted to the possibility of stock market returns on a tax deferred basis without the stock market risk. Fixed Annuities Single premium annuities that offer several payment options to the contract holder that currently offer competitive rates of interest and in some cases bonus rates of interest. Asset Allocation Annuities Relatively new in the industry but one of the most popular today. These annuities have several investment options inside including a fixed interest rate option. These annuities permit investors to split up their money into different options. Investors seeking high returns while minimizing risk find the diversification features attractive. Great for 401(k) rollovers. Flexible Premium Annuities Perfect for investors who want a tax deferred investment that they may systematically add to on a consistent basis. Suitable for either traditional or Roth individual retirement accounts. Bonus Annuities Annuities that offer bonus credited rates of interest usually in the first few years of the contract in addition to the current stated rate of interest. In some cases the additional bonus rate can exceed 7%. It is not uncommon for people to experience better than 14% in the first year with certain policies. Also very suitable for retirement plan rollovers.